On 29 April 2025, the Constitutional Court of Russia issued Ruling No. 999-O, clarifying that Article 248.1 of the Arbitrazh Procedure Code (APC RF) – which grants Russian Arbitrazh courts exclusive jurisdiction over sanctions-related disputes – does not apply automatically. A claimant must demonstrate real, concrete obstacles to accessing justice in a foreign forum before a Russian court can assume exclusive jurisdiction on that basis. This ruling materially affects the litigation strategy of international companies facing debt collection claims or enforcement proceedings in Russia.
What Article 248.1 and 248.2 APC RF Provide
Article 248.1 APC RF establishes exclusive jurisdiction of Russian Arbitrazh courts over disputes involving persons or entities subject to sanctions, or disputes arising from restrictive measures. In practice, Russian counterparties have invoked this provision broadly – and in some cases aggressively – to redirect foreign arbitration or litigation proceedings to domestic Russian courts, even where valid foreign jurisdiction agreements existed.
Article 248.2 APC RF supplements this mechanism by allowing a party to obtain an anti-suit or anti-arbitration injunction from a Russian Arbitrazh court, restraining the opponent from pursuing proceedings abroad. Critically, the penalties for non-compliance with such an injunction can reach up to the full amount of the claim in dispute. For international companies managing unpaid invoices or enforcement of judgment processes, the financial exposure from an Article 248.2 injunction has been significant.
What Constitutional Court Ruling No. 999-O (29 April 2025) Changes
The Constitutional Court found that the mere existence of sanctions against one of the parties is not, by itself, a sufficient ground to invoke Article 248.1. The ruling introduces a substantive threshold: the applicant must show that it faces real obstacles to accessing justice in the otherwise competent foreign forum. Abstract or hypothetical difficulties do not satisfy this test.
This is a meaningful constraint. Prior to Ruling No. 999-O, some Arbitrazh courts had accepted Article 248.1 applications with limited scrutiny of whether the foreign proceedings were in fact unavailable or impractical. The Constitutional Court has now signalled that this approach is constitutionally impermissible.
The following practical consequences flow from the ruling:
- Burden of proof shifts: The party invoking Article 248.1 must substantiate, with evidence, that the foreign court or arbitral tribunal is genuinely inaccessible – for example, because a foreign court has refused to hear the matter or enforcement is demonstrably impossible.
- Automatic transfer of jurisdiction is precluded: A Russian court cannot simply accept exclusive jurisdiction on the basis that sanctions exist; it must undertake a fact-specific assessment.
- Anti-suit injunctions under Article 248.2 face higher scrutiny: Because the jurisdictional predicate under Article 248.1 is now more demanding, injunctions sought under Article 248.2 – with their severe penalties – should in principle be granted less readily.
- Foreign arbitration clauses regain practical weight: Where a foreign arbitral tribunal or court is genuinely accessible, the existence of sanctions alone should no longer override a contractual dispute resolution clause.
If you are currently facing proceedings in which Article 248.1 has been invoked against your company, or if you have received notice of an application for an asset freezing order or anti-suit injunction under Article 248.2, the implications of Ruling No. 999-O are directly relevant to your position. We encourage you to contact our team at info@ferrazwhitmore.com or visit our contacts page to discuss your specific circumstances.
Supreme Court Thematic Review No. 8/2026 (June 2026)
In June 2026, the Supreme Court of Russia issued Thematic Review No. 8/2026, consolidating the evolving case law on counter-sanctions disputes. This review builds upon the Constitutional Court's analysis in Ruling No. 999-O and provides Arbitrazh courts with more structured guidance on applying the real-obstacles test in practice. While the full operational detail of the review is subject to ongoing judicial interpretation, its direction is consistent with a more restrained application of exclusive jurisdiction provisions.
International companies involved in debt collection, payment order proceedings, or late payment interest claims in Russia should treat the Thematic Review as an important reference point when assessing the procedural posture of any pending or anticipated dispute. Our analysis of related Supreme Court guidance is available in our earlier alert: Russian Supreme Court Consolidates Counter-Sanctions Case Law.
Who Is Affected
The ruling and subsequent review are most directly relevant to:
- Foreign companies – particularly those from jurisdictions that have imposed sanctions on Russia or Russian persons – that are parties to Russian-law contracts or have assets or receivables in Russia.
- Companies with arbitration or foreign court clauses in their contracts with Russian counterparties, where those counterparties have sought or may seek to invoke Article 248.1 to redirect proceedings to a Russian Arbitrazh court.
- Companies already subject to an anti-suit injunction under Article 248.2, or at risk of one, given the penalty exposure of up to the full claim amount.
- Entities involved in enforcement of judgment proceedings in Russia, where the counterparty's sanctions status has been cited as a jurisdictional argument.
- Companies seeking to recover unpaid invoices or pursuing late payment interest claims against Russian debtors who have raised sanctions-based jurisdictional objections.
The involvement of the Government Commission on Control over Foreign Investments in certain sanctions-related transactions may also intersect with the jurisdictional questions addressed by Ruling No. 999-O, depending on the nature of the underlying dispute.
Immediate Action Items for International Companies
In light of Ruling No. 999-O and Thematic Review No. 8/2026, we recommend that international companies take the following steps promptly:
- Audit active and anticipated disputes in Russia. Identify any proceedings – whether debt collection actions, payment order applications, or enforcement steps – where Article 248.1 or 248.2 has been or could be invoked. Assess whether the opposing party can genuinely demonstrate real obstacles to foreign proceedings.
- Gather evidence of foreign forum accessibility. If you are defending against an Article 248.1 application, document the availability and practical operability of the contractually agreed foreign arbitration or court. Evidence that a foreign tribunal is accessible and willing to hear the matter directly counters the threshold requirement.
- Review anti-suit injunction exposure under Article 248.2. If an injunction is already in place or being sought, assess the penalty mechanism in light of the new constitutional standard. Consider whether there are grounds to challenge or narrow the injunction.
- Re-evaluate dispute resolution clauses in new and existing contracts. For ongoing commercial relationships with Russian counterparties, consider whether contractual dispute resolution provisions adequately reflect the current legal landscape and provide workable access to neutral forums.
- Monitor further judicial guidance. The practical application of Ruling No. 999-O is still being worked out by Arbitrazh courts across Russia. Maintaining close monitoring of first-instance and appellate decisions in this area – particularly in the coming months – is essential for anticipating procedural risks.
Our dedicated practice on debt recovery in Russia covers the full spectrum of Arbitrazh court proceedings, including jurisdictional challenges under Articles 248.1 and 248.2. Our team can assist in assessing the strength of any counter-sanctions jurisdictional argument raised against your company and in preparing the evidentiary record required under the new standard.
Intersection with Sanctions and Trade Compliance
It is important to recognise that the jurisdictional developments described above do not exist in isolation from broader sanctions compliance obligations. A company navigating a dispute before a Russian Arbitrazh court – whether as claimant or respondent – must simultaneously ensure that its litigation conduct, including any asset freezing steps or enforcement measures it takes or submits to, does not create exposure under applicable sanctions regimes. These two dimensions require coordinated legal advice.
For companies managing the trade and sanctions dimension alongside their Russian litigation exposure, our sanctions and trade practice for Russia provides integrated support across both areas.
If your company is assessing how Ruling No. 999-O affects an existing or anticipated dispute in Russia, our team is available to advise. Please reach out at info@ferrazwhitmore.com or through our contacts page.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.